Utility and Consumer Behavior Theory
Consumer Behavior Theory: These theories consider a range of factors that influence the choices of the consumers.
Intrinsic Properties: These are the internal properties of the object.
Neoclassical Microeconomics: This is the branch of economics that examines consumer utility.
Economic theories on consumer behavior have always fascinated microeconomists and policy makers. Understanding the way consumers behave is a challenging task as each consumer has unique characteristics and they respond differently to different situations (Bovi 2009). Economists have used different approaches to explain consumer behavior. The main aim of Samuelson’s (1938) study was to examine utility as a psychological construct, while analyzing issues related to the marginal rate of substitution and how consumers behave to with changes in price. Samuelson (1938) extended Georgescu-Roegen’s (1936) study of the pure theory of consumer...
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